| 10 Tips for Investing in Distressed or Foreclosed | | | | doing the work yourself. |
| Properties | | | | 6. If you are going to sell the property after |
| 1. Search on the world wide web for distressed | | | | rehabilitating it, ask your REALTOR to research |
| or foreclosed properties as a starting point. Use a | | | | similar properties in the neighborhood to ascertain |
| professional REALTOR to identify great | | | | market price. |
| foreclosure deals for you. You may be successful | | | | 7. Keep copious records for tax deductions. Any |
| at searching the web on your own, but keep in | | | | expenses related to the purchase, repair, or |
| mind some of the information is outdated, some | | | | maintenance of the property may qualify. |
| may be incorrect, and some of the available | | | | Meticulous records are key to a profitable real |
| properties are not even listed. A REALTOR | | | | estate venture. |
| subscribes to updated MLS listings and can offer | | | | 8. The title you receive after purchasing a |
| you the most current information available. | | | | distressed or foreclosed property is a special |
| 2. If you search yourself for distressed properties | | | | warranty deed rather than a general warranty |
| and purchase from the selling agent, you are | | | | deed. Some buyers are alarmed by this, but there |
| paying a commission to someone with a vested | | | | is no need to worry. The purchase of title |
| interest. Obtain objectivity in the sale by working | | | | insurance protects the buyer. Each lender |
| with your own REALTOR. You won't pay any | | | | purchases insurance to protect the loan as well. |
| more. Technically, everyone works for the seller, | | | | Titling insurance should be obtained by the |
| since they pay the commission. | | | | property purchaser. It is always offered by the |
| 3. With distressed or foreclosed properties, time is | | | | closing agent. Consider using an attorney instead |
| of the essence. Purchasers must close on the | | | | of a titling company as your closing agent. An |
| date specified by the agency, and cannot close | | | | attorney is only $50-75 more than a titling |
| after this without penalties of $25-200 per day. | | | | company. A real estate attorney can remedy any |
| 4. It takes 1-3 weeks to qualify a loan. If you are | | | | situation that may arise. Therefore, they are |
| approved for a loan, make sure you are qualified | | | | more efficient representatives on time sensitive |
| by your lender as soon as possible. If you are | | | | foreclosure properties. |
| paying by cash, make certain funds are available. | | | | 9. Foreclosure properties require special |
| If finances are in order, the REALTOR will then | | | | addendums and special contracts by the individual |
| submit an offer. When the offer is accepted by | | | | bank and HUD office (where applicable). |
| both seller and buyer, the REALTOR will submit | | | | 10. Foreclosure properties are potentially the most |
| the ratified contract to the lender and closing | | | | profitable, but require the most attention to detail. |
| agent. These steps will begin the process of a | | | | A REALTOR experienced in foreclosure deals is |
| successful real estate transaction. | | | | highly desirable because the paperwork must be in |
| 5. When purchasing a distressed property, always | | | | order to submit a proper bid, and timeliness is |
| obtain 3-4 bids from different contractors to | | | | critical. |
| estimate costs of repairs, if you do not plan on | | | | |